8612018 Informal Interpretation

us-ftc-hsr-informal-interpretations-269f2aa9fed89ef622c83009044d58838612018 Informal InterpretationGuidance

Date
Rule
16 C.F.R 802.20
Staff
Wayne Kaplan
Response/Comments
Subject to real intent of parties to actually acquire and hold the 49% of the initial org. is not reportable.

Question

December 29, 1986

Wayne Kaplan, Esq.
Premerger Notification Office
Federal Trade Commission
6th and Pennsylvania Ave., N.W.
Washington, DC 21580

Dear Mr. Kaplan:

I am writing to confirm a discussion we had on December 22, 1986 concerning a proposed acquisition of voting securities. Company A intends to acquire Company B, a wholly-owned subsidiary of Company C, for approximately $25 million. The size of the parties test is met.

Pursuant to a letter of intent, Company A intends to purchase 49% of the outstanding shares of Company B for $13.8 million prior to December 31,1986. Company B will pay the $13.8 million into a custodial account. Company A intends to acquire the remaining 51% of the shares of the shares of Company B as soon as possible. Such closing shall be subject to termination or expiration of the applicable waiting period under the Hart-Scott-Rodino Act.

You indicated that the acquisition of 49% of the shares of Company B by Company A in such circumstances is exempt from the reporting requirements of the Hart-Scott-Rodino Act pursuant to 16 C.F.R. 802.20.

Sincerely,

(redacted)

cc: (redacted)

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